News added on 10.12.2018


National minimum wage

Government updates minimum wage guidance to include unpaid work trials

The government has updated its national minimum and national living wage guidance to include a wholly new section on unpaid work trial periods. What does the guidance say about them?

If you’re not sure whether to offer a job applicant the role they applied for, one option would be to run a short work trial to enable you to assess whether they have the skills and qualities required for the job. Work trials can be a legitimate means of carrying out a recruitment process. However, you may be contravening the law if you don’t pay the individual at least the national minimum wage (NMW) or national living wage (NLW), as applicable according to their age. You must pay someone the NMW/NLW if they fall within the statutory definition of a “worker”, i.e. they work under an employment contract, or any other contract to personally provide work or services, whether express or implied, and (if it’s express) whether oral or in writing.

The government’s guidance says that whether a work trial results in a contract requiring the NMW/NLW to be paid will depend on the circumstances of the case, and there are currently no definitive rules and tests. However, in its view, a court or tribunal is likely to take account of the following factors:

  • whether the work trial is genuinely for recruitment purposes - if it’s not, it will generally be considered to be work for which the NMW/NLW must be paid
  • whether the trial length exceeds the time that you’d reasonably need to test the individual’s ability to carry out the job - the government’s view is that an individual carrying out a work trial lasting longer than one day is entitled to the NMW/NLW in all but very exceptional circumstances
  • the extent to which the individual is observed while carrying out the tasks
  • the nature of the tasks carried out and how closely they relate to the job on offer - where the tasks are different from those which the job would involve, this may indicate that you’re not genuinely looking to test the individual’s ability, but rather to get the tasks carried out
  • whether the tasks carried out have a value to you beyond testing the individual - where the tasks are carried out in a simulated rather than real environment, this will normally indicate that they do not have such a value and that the individual is not “working”
  • whether trial periods are important (aside from recruiting) to the way you run your business - for example, where trial periods are used as a means to reduce labour costs, this is likely to indicate that the individual is “working”.

The guidance also says that an unpaid work trial lasting a few hours may be reasonable and not create an entitlement to the NMW/NLW, if the main purpose is to test the individual and what is done has little or no other value to you. However, conversely, an unpaid work trial lasting more than one full shift or several days in a real (not simulated) work environment is likely to create an entitlement to the NMW/NLW in all but very exceptional circumstances. Finally, the guidance provides six useful hypothetical example scenarios to illustrate some of the factors outlined above.

As with all guidance, it’s not definitive and each case will be judged on its own facts. Ultimately, the question of whether someone is a worker is for a court or tribunal to decide.

The guidance sets out a number of factors that may be taken into account when considering whether an individual should be paid at least the NMW/NLW for the tasks they perform when undertaking a work trial. In the government’s view, the longer a trial period continues, the more likely it is that it results in a contract to provide work, meaning that the NMW/NLW is due.

© Indicator - FL Memo Ltd • Telephone: (01233) 653500 • Fax: (01233) 647100 • •
Calgarth House, 39-41 Bank Street, Ashford, Kent TN23 1DQ • VAT GB 726 598 394 • Registered in England • Company Registration No. 3599719